AUD/USD range trades near four-year lows
James Chen October 22, 2014 8:16 PM
<p>AUD/USD (daily chart shown below) has continued to trade within a well-defined range after having dropped down to establish a four-year low of 0.8641 just […]</p>
AUD/USD (daily chart shown below) has continued to trade within a well-defined range after having dropped down to establish a four-year low of 0.8641 just a few weeks ago in early October.
The trading range is bounded roughly by the 0.8850 resistance level to the upside and the 0.8650 support level to the downside.
This current consolidation shows similarities with the one that occurred back in January and February, when the currency pair bottomed-out and rebounded around the same 0.8650 support area from which the current trading range has bounced.
In the event of a breakdown of the consolidation pattern and the noted 0.8641 low, a new multi-year low will have been established, with further downside support targets around 0.8600 and then 0.8300.
To the upside, a bottoming-out reminiscent of the beginning of the year could be indicated on a breakout above the noted 0.8850 resistance level. In this event, a key target immediately to the upside resides around the 0.9000 psychological resistance level.
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